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Step 1 – Talk to Your Family Buying a new house impacts the whole family and everyone is sure to have an opinion. Work together to determine the features that are most important for your next home. Take into consideration the size of home and number of rooms you’ll need, preferred amenities, location and other factors. Good communication makes the home buying process easier and more rewarding. Tip: Choosing the Right Neighborhood Finding the right neighborhood is nearly as important as choosing the right home. Check out our guide: How to Choose the Best Neighborhood for You.

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Step 2 – Do Your Homework If you’re viewing this SlideShare, this is likely the stage you’re at right now. You are probably also looking at websites, real estate publications and other resources. That’s great. Knowledge is power when it comes to home buying. You can also check your local government’s Property Appraiser’s website to get a sense of how property values are trending for individual neighborhoods. Tip: Learn from Other People’s Mistakes There’s no need to repeat the mistakes of other home buyers. Take a look at 6 First-Time Homebuyer Mistakes and How to Avoid Them.

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Step 3 – Get Pre-Approved Getting pre-approved for a mortgage loan is always a smart idea. To get pre-approved, you simply submit a loan application and supporting documentation to New American Funding. Being pre-approved lets you know exactly how much home you can afford to finance so you don’t waste time looking at houses that are too expensive. Pre-approval also shows prospective sellers you’re serious, making your purchase offer more credible. Tip: Prepare Your Documents Loan applications, including pre-approvals, require a certain set of paperwork. Find out what to expect with our 5 Things You Need to Be Pre-Approved for a Mortgage Loan.

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Step 4 – Select a Real Estate Agent Your real estate agent is an important ally in your search for a new home, so take time in selecting her or him. Asking friends and neighbors who they worked with is a good place to start. Interview multiple real estate agents to find one whose market knowledge, negotiating skills and personality are your best fit. The most important attribute of a realtor is listening to and understanding your needs. Tip: Surround Yourself with the Best People The real estate agent is just one of several people you’ll work with as a home buyer. Take a look at People Involved in the Mortgage Process to learn about the other professionals.

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Step 5 – Find Your New Home Don’t expect to fall in love with the first home you visit, or the second, or the third. Finding the right home can take some time and patience is your friend. When you tour a house, try out everything. Don’t be too embarrassed to open closets, turn on faucets and test electrical switches. Take notes on each house you visit. You’ll likely tour a lot of homes and it’s easy to forget which was which. Tip: Get the Picture Take photos of each house you visit and file them with your notes. Of course, if a home is still occupied, you should always ask for the current owner’s permission.

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Step 6 – Make an Offer Deciding how much money to offer is stressful for many homebuyers. You want the home, but you want the best possible price. Some say a good rule of thumb is 5% less than the listing price, but there are several factors to consider. Review recent sales of comparable houses, consider how competitive the market is and how eager the sellers are. A motivated seller may accept a smaller offer. Tip: Study the Market There are several online resources you can use to find accurate information about how many homes have sold in a neighborhood and at what price. Ask your real estate agent.

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Step 7 - Negotiate Unless you offered to pay full listing price, prepare for some negotiation. Just like you, sellers want the best possible deal in their favor. They will likely counter-offer on price, but price isn’t the only piece of the puzzle. Some common negotiating points include closing costs, appliances and fixtures, repairs and upgrades and occupancy timing. Use all the tools at your disposal. Tip: Be Willing to Walk Away If negotiations aren’t going as you hope, maybe this isn’t the house for you. A home is a big investment and you don’t want to over-extend yourself.

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Step 8 – Get a Home Inspection Your buying offer should be contingent upon the results of a home inspection. Sellers sometimes have inspections done beforehand, but for peace of mind you’ll want your own inspector to check out the property. An inspector will thoroughly review the entire home to identify problem areas and any items in need of repair. The inspector’s findings may result in another round of negotiations with the sellers. Tip: Remember the Walkthrough Just before closing, you’ll do a walkthrough of the home to ensure any repairs were made. Check out our guide to What to Look for in a Final Walkthrough.

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Step 9 – Shop for Insurance Homeowners insurance protects you against fire, windstorms, hail, lightning, theft, vandalism and other liabilities. Floods and earthquakes usually have to be covered under separate policies. Typically, a homeowners insurance policy covers the structure of the home as well as items inside like electronics, furniture, clothing, etc. When shopping for homeowners insurance, don’t just look at price. Research the provider’s financial stability and record for claims service. Tip: Title Insurance At closing, you will also sign up for title insurance, protecting you in case of legal issues with the title such as errors or omissions, forgery or undisclosed heirs to the property.

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Step 10 – Finalize Your Loan If you were already pre-approved, this part is easy. Your New American Funding representative will walk you through available mortgage options and any remaining paperwork and guide you to the best loan type and terms for your needs. At New American Funding, we make the mortgage loan process easy to manage and stress free. Tip: Learn the Terms Fixed, ARM, VA, FHA…don’t be intimidated by terminology. Learn about these terms and more with our SlideShare on Home Loan Options – Choosing the Right Loan for You.

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Step 11 – Have the Home Appraised To ensure the home is worth at least as much as you’re paying for it, your mortgage lender will hire a third-party appraiser to physically review the property. By determining the true market value, an appraisal protects the lender from making a loan that’s too large for the asset. It also gives the buyer an additional expert opinion as to the home’s worth. Tip: Know What They Look For Appraisers consider everything from the neighborhood to the appliances. Find out what else by reviewing What Do Home Appraisers Look For.

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Step 12 – Closing Closing is a meeting during which the formal transfer of property from the seller to the buyer takes place. It involves a lot of paperwork. Some people joke that their hands hurt from signing their names so much during. You will need to pay your down payment, closing costs and other fees during this meeting. Check with your closing agent in advance for acceptable forms of payment. Tip: Prepare for Paperwork You’ll be more comfortable going into closing if you know what paperwork to expect. Take a look at our First-Time Homebuyers Guide to Closing Documents.

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Congratulations!

It’s Time to Move in! You’ve successfully purchased a home. We hope you’ll enjoy it for years to come.

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12 Steps for Buying a New Home

If you’re in the market for a new home loan, contact us today…

www.NewAmericanFunding.com

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